Lifetime ISA and Stamp Duty

mhuk01

Hello,

I have a slightly complex question regarding Lifetime ISA bonus and Stamp Duty.

I own a property and am married. My wife is not listed on the property deeds - I purchased the property before we were married. We would like to purchase another property, in addition to keeping hold of my current property (which we both live in at the moment).

The new property purchase would be around £150,000. My wife holds a lifetime ISA. I understand we should be eligible for the bonus as she is a first time buyer?

My second part of the question is regarding Stamp Duty. My understanding is that as we are not both first time buyers, we will not benefit from 0% stamp duty, and have to pay the standard rate. Is that correct? In addition to this, I now realise there is an extra charge for people buying a second home. Will we be stung by this as well?

As it stands, it looks like we will have to pay around £4,000 stamp duty, which effectively wipes out the bonus we could get from the Lifetime ISA. Is there any way to (legally) avoid the stamp duty side of things, with how the properties are listed in our names for example?

Many thanks,

Martin

Tom99

[FONT=Verdana, sans-serif]If you keep your existing property you will pay the higher rate (ie +3%) stamp duty on the purchase whether you both or just your wife buy the new property.

[/FONT] [FONT=Verdana, sans-serif]If you sell your existing property you will pay standard stamp duty on the new one since you are not both FTBs

[/FONT] [FONT=Verdana, sans-serif]If keep your property but divorce your wife and she buys the new property just in her name there should be no stamp duty since she will be a FTB.[/FONT]

mhuk01

Ok thanks for that, as I expected really. Although does anyone have any experience of things like existing property to a limited company, as a way round this? I used the calculator on the gov website, and this stamp duty will cost us an extra £5000, so we really are trying to exhaust all options.

juniordoc

Limited company mortgages come with higher rates.
You should probably just pay your taxes (or not buy a second home).

SDLT_Geek

Oddly if you sell the existing property and your wife alone buys the new property (so that you have no share in it at all) then she might benefit from first time buyers relief. It is not true to say that spouses are treated as a unit for SDLT purposes.

If you sell your existing property to your company, the company will pay SDLT on the market value at the surcharged rates.